Why Pell Grant Recipients Are Getting Double the Debt Relief Under Biden’s Plan

This week, as expected, President Biden announced that his administration would cancel $10,000 in student debt for borrowers earning less than $125,000 a year. What may have surprised those waiting for this announcement was that the president also stipulated that students who received Pell Grants could receive an additional $10,000 in cancellation. That left many people asking: What is a Pell Grant?

Congress created the Basic Education Opportunity Grant Program in 1972 to expand access to higher education for low- and moderate-income students by subsidizing its cost through a federal grant. The program was later renamed the Pell Grant program, in honor of one of the program’s leading advocates, Senator Claiborne Pell (D-RI). Senator Pell was known for saying that “any student with the talent, desire, and drive should be able to pursue higher education,” regardless of their income.

While there was a push from the higher education community at the time to provide federal funding to institutions based on their enrollments, many lawmakers believed that giving aid directly to needy students was the most efficient and effective way to remove the financial barriers they faced. For that reason, individual students can use Pell Grants at the accredited college or university of their choice. Then, as now, Congress set a maximum amount for each award year, but the amount a student receives is determined on a sliding scale, based on a student’s expected family contribution (EFC), the cost of attendance of the chosen school, and the student’s enrollment status (part-time or full-time).

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